Mutations in fused in sarcoma (FUS) are linked to amyotrophic lateral sclerosis (ALS), a fatal neurodegenerative disease affecting both upper and lower motor neurons. While it is established that astrocytes contribute to the death of motor neurons in ALS, the specific contribution of mutant FUS (mutFUS) through astrocytes has not yet been studied. Here, we used primary astrocytes expressing a N‐terminally GFP tagged R521G mutant or wild‐type FUS (WTFUS) and show that mutFUS‐expressing astrocytes undergo astrogliosis, damage co‐cultured motor neurons via activation of an inflammatory response and produce conditioned medium (ACM) that is toxic to motor neurons in isolation. Time lapse imaging shows that motor neuron cultures exposed to mutFUS ACM, but not WTFUS ACM, undergo significant cell loss, which is preceded by progressive degeneration of neurites. We found that Tumor Necrosis Factor‐Alpha (TNFα) is secreted into ACM of mutFUS‐expressing astrocytes. Accordingly, mutFUS astrocyte‐mediated motor neuron toxicity is blocked by targeting soluble TNFα with neutralizing antibodies. We also found that mutant astrocytes trigger changes to motor neuron AMPA receptors (AMPAR) that render them susceptible to excitotoxicity and AMPAR‐mediated cell death. Our data provide the first evidence of astrocytic involvement in FUS‐ALS, identify TNFα as a mediator of this toxicity, and provide several potential therapeutic targets to protect motor neurons in FUS‐linked ALS.